FWIW...I pop seeds out of coco, once the taproot show itself, they go into my coco. I have used this method for over a year with great results and root structure.

Things I might be doing differently than you: I don't feed until they are above the coco line for a week or two. This way, letting the coco dry a bit isn't very dangerous. I also use beer cups for the first two weeks...not a bed. Also, I use Botanicare Moisture formula coco. Maybe a different consistency than what you're using? Most likely.

Not sure if this helps or not, just wanted to lay out some info for ya. Except for germination, I'm in coco the whole time and have great root devlopment. I have read that letting coco dry out (A BIT) for seedlings is ideal.